The NHS as we know it needs a prayer

Regulations laid last week will turn England's National Health Service into a competitive market. They appear to contradict assurances from the Coalition government on one of the most central elements of the Bill.

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Last Wednesday the Department of Health quietly released regulations [1] that open up England’s
National Heath Service to competition on an unprecedented scale. These regulations
have started their 40-day journey to becoming law. They contradict the
political assurances given during the turbulent passage through parliament of
the controversial Health and Social Care Act 2012 and confirm the fears of its
critics.

The extent to which competition should be applied to the NHS has
been at the heart of fierce debates surrounding the Health and Social Care Bill
since it was published in 2011. Government representatives have maintained that
the use of competitive markets is central to their purpose [2].
Critics warned that making competition compulsory was dangerous and driven by
ideology and commercial interests rather than evidence-based best health
practice. It was also feared prioritising competition indiscriminately could
create a fragmented, expensive, bureaucratic health service [3] and a transition to much fuller privatisation [4].

The Government worked hard to reassure and win over opponents,
softening the language in the Act and balancing mentions of competition with
talk of cooperation. While the media and the public focussed on the political
battle, and the language of ‘patient choice’ and ‘GPs in control’, the legal
nuts and bolts of the act embodied the reality of the reforms. Few people
noticed as this was obscured by technical and legal complexity and a towering
tornado of spin.

The unvarnished truth was revealed in regulations [5] laid before parliament under
Section 75 [6] of the Health and Social
Care Act last Wednesday, following a little-publicised consultation period last
Autumn. They relate to the area of ‘procurement, patient choice and
competition’. They expose the underlying legal and economic logic of the Act to
be about embedding market competition as the driving force in the new NHS.

The regulations force health commissioners
to open up virtually all services to competition, either through competitive
tendering or using the Any Qualified Provider market. The AQP market operates
as the ‘Choose and Book’ [7] system which provides patients with a shopping list of services to chose their
treatment from.

From the 1st April commissioners will be required to advertise [8] new contracts, then judge the bids received based on published
criteria. The new regulations effectively close down the possibility of
awarding a contract without competition, saying that this can only occur in
very exceptional circumstances (namely emergency situations or when no other
provider is capable of providing the same services) [9].
They also pull arrangements between NHS bodies into the new competition regime.
This appears totally contrary to former health secretary Andrew Lansley’s
assurances to Clinical Commissioning Groups this time last year [10].

The new regulations grant Monitor sweeping statutory powers as a
regulator to intervene and enforce competition [11].
Monitor will be able to decide when commissioners have breached competition
regulations, and have the authority to set aside contracts, stop arrangements
that they deem flawed and to impose competitive tendering and the offer of Any
Qualified Provider. During the Bill’s passage, Monitor’s role as regulator
changed from one of ‘promoting competition’ to instead ‘preventing
anti-competitive behaviour’, but as some suspected, this is a distinction
without a difference [12].

Far from giving GPs flexible powers to choose the right provision
for patients, these regulations force competitive markets across the board,
barring only very exceptional circumstances. They bring an inherent assumption
that a greater choice of providers is better for patients.

Implementing commercial competition throughout the NHS creates rights for independent
providers to compete for any NHS funding that is spent on purchasing
services for patients. Such a regime benefits private providers and
reorientates the whole system towards the focus on penny-pinching that has just
proved fatal to so many at Stafford Hospital [13].
‘Provider rights’ lock the privatisation of services into place because
renationalisation would trigger compensation claims due under competition law,
making it extremely expensive and politically difficult for a government to
turn back.

The last Labour government introduced the ‘Principles and Rules of
Cooperation and Competition’ which effectively applied competition law to
contracting for patient services. The new regulations put the previous
principles and rules on a statutory footing. Where previously Primary Care
Trust commissioners were encouraged to commission services through competitive
markets, CCGs will be required to do so for almost all services. These regulations
take the brakes off and allow competition to freewheel.

Labour Lord Philip Hunt told us, “These regulations go to the heart
of the arguments about our health service and where it’s going. If you think
back to the extensive debate on the Bill, the underlying question was ‘is a
market being set up?’ The government was forced to make concessions and had to
insert words about integration. Whatever was said in parliament, it seems that
the Department of Health and Monitor have just carried on as if nothing has
changed. By hook or by crook, a market is being introduced. This fundamentally
undermines the NHS and its very concept.”

Lord Hunt continued, “There is very little international evidence
that a market in healthcare leads to better or more cost-effective service, in
fact most suggests the opposite. Post-Francis report, the key consideration
should be quality of care. This is a distraction from that. There is no doubt
that Monitor are preparing the ground for a competitive market and that we’re
on a journey to competition, marketisation and privatisation. We definitely
want a debate and for these regulations to be submitted to proper
scrutiny”.

The new regulations are likely to surprise health professionals,
politicians and the public as they are clearly incompatible with the
reassurances and promises that the Government made whilst they were struggling
to win support for their Bill.

Andrew Lansley sent a letter to prospective CCGs on 16th February
2012 [14], during the height of the
battle to get the Bill through parliament, in which he assured them, “I know
many of you may have read that you will be forced to fragment services, or to
put services out to tender. This is absolutely not the case. It is a
fundamental principle of the Bill that you as commissioners, not the Secretary
of State and not regulators, should decide when and how competition should be
used to serve your patients’ interests. The healthcare regulator, Monitor,
would not have the power to force you to put services out to competition.” The
new regulations contradict these promises in Lansley’s letter.

Liberal Democrat Lord Clement-Jones was one of many who expressed
concerns about the application of competition law during the passage of the
Bill through the House of Lords, and received reassurances from Health Minister
Earl Howe that; “Clinicians will be free to commission services in the way they
consider best. We intend to make it clear that commissioners will have a full
range of options and that they will be under no legal obligation to create new
markets, particularly where competition would not be effective in driving high
standards and value for patients. As I have already explained, this will be
made absolutely clear through secondary legislation and supporting guidance as
a result of the Bill.” [15]

These regulations do not grant commissioners the ‘full range’ of
options that Earl Howe seemed to be promising. Lord Clement-Jones, having
examined the regulations, told us, “Earl Howe’s statements in the House of
Lords appear completely at odds with these regulations. These regulations
clearly seem to go further in requiring competitive procurement than the
undertakings we were given during the passage of the Bill. We will be taking
this up with our colleagues within the Coalition”.

While these regulations are contrary to the spirit of the
reassurances given during the passage of the Bill, they closely mirror Andrew
Lansley’s speech in 2005 [16] where he very clearly spelt
out his intentions to open up the NHS to competition. Drawing on his experiences
privatising utility services, he said that “the first guiding principle” of
public service reform is to “maximise competition” and that he wanted to “plan
positively” for health being a competitive market in the European Union. He
also advocated a “right to supply for new and independent providers” and
envisaged that “the Independent Regulator will need progressively to be a
competition authority, with the normal application of competition rules to
healthcare providers”.

Lansley’s speech reads like a blueprint for the regulations that
have just been issued. Indeed, along with the ‘Principles and Rules for
Cooperation and Competition’ [17], they represent the
legislation for the implementation of EU Competition Law in the NHS.

These regulations can also be understood as part of a broader
international trade agenda which involves liberalising services. US President
Barack Obama recently announced [18] the forthcoming US-EU Free
Trade Agreement, which David Cameron has said [19] will be a key priority for the G8 this year. As part of the preparations for
this, EU countries have been instructed to harmonise their economies with the
US regulatory system. Publicly-owned and run healthcare systems, many of which
are at or near completion of a process of privatisation, are a little-reported
but prime focus of this process. International trade researcher Linda Kaucher [20] put it another way when
speaking to us, “The NHS is being chopped up and prepared for transnational
investors.”

Chair of the Royal College of General Practitioners Dr Clare Gerada
shared concern about the new regulations and told us, “This is about free
markets, not healthcare. It is predicated on making money, not on doing the
best thing. The NHS is a system that channels resources according to need. What
the Act does is change it to a system that channels resources according to what
makes money. Competition is the vehicle for changing it. I feel that it’s more
important than ever that we do everything we possibly can to challenge the
perversities of this marketisation. The money needed to run this new market
will take away money from services.”

Caroline Molloy, a campaigner for ‘Keep Our NHS Public’ working on a
briefing paper about these regulations, emphasised to us, “People never voted
for NHS reforms in the last election and they proved unpopular with the public
and health professionals. Now these additional regulations are being quietly
slipped through trying to enforce competition in the NHS, contrary to
reassurances that were given in Parliament and to commissioners. These
regulations prioritise the rights of providers, not the rights of patients,
commissioners, local communities or indeed elected representatives. We believe
that there should be a full parliamentary debate and vote on these regulations.”

The regulations are subject to the parliamentary procedure ‘negative resolution’, which means that they don’t need to be discussed or voted on, but will automatically become law 40 days after being laid down, on the 1st April.

Any member of parliament could lay a “prayer” to start a motion to
attempt to annul them within this timeframe. There seems to be plenty of
appetite for such a process. With enough support, this could trigger a debate
and potentially a vote in one of the houses. A statutory instrument of this
nature hasn’t been successfully annulled for over 10 years in the Lords and
over 30 years in the Commons [21], and it will require mass action to effect a change against such
odds.

Parliament has one final chance to defeat this legislation before April 1st - please help put pressure on them by signing this petition.

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